Regulatory Section of the Due Diligence Report

To investigate the development potential of a site, research local, regional, state, and federal regulations and determine the impact these regulations will have on the development potential of a site. Assess the complexities of these regulations and calculate how:

1. The time obtaining approvals may affect the transaction, financing, and market entry
2. The costs associated with regulatory compliance affects the project proforma
3. The net development area of the site and yield is reduced by government regulations

Concentrate on local regulations since every jurisdiction approaches real estate development control differently. A municipality will stress certain regulations based on their experience level and many requirements may still be open for interpretation. This section of the due diligence report highlights current technical conditions imposed by government which most likely will affect the development potential of a site.  

I will explain each of the following investigative tasks in subsequent blog posts.

1. Current Rezoning Applications
2. Development Impact on Services & Existing Infrastructure
3. Dedications, Easements and Encroachments
4. Road Access, Offsite Road Improvements & Onsite Road Circulation
5. Land Development Regulations
6. Stormwater Management Facility Requirements
7. Best Management Practices
8. Regional, State, and Federal Regulations
9. Entitlement, Approval and Permitting Process

Most local regulations have not been updated at all and especially not to reflect new development patterns. Real estate development leaders should present horizontal and vertical mixed use regulations to local politicians and regulators.